Captain Morgan
Supportive Member
Hi Guys,
I was wondering what an acceptable average profit margin for these market segments are in our industry is?
I know that the costs and expenses for each business are different based on a start up vs. an established business and different parts of the country can garner different amounts per square foot than others...that said, I'm looking for a general range to use as a guide for my business and marketing plan.
I feel I've done a good job of calculating all my expenses for supplies, marketing, education, insurances, repairs replacement equipment costs, salary, misc expenses, etc etc..
I've heard some say profit margins should be a minimum 50-60%. When I shoot for that percentage my prices are astronomical! When I lower it to what are more in line to what current market rates my margin is like 12% and I don't see myself as being to stay in business very long.
Am I missing something? Is it normal in the first few years to be THAT upside down? I need to be profitable from the start and not be working for free hoping in 4-5 years "word of mouth" and referrals will catch hold and take me to the promised land. It didn't work before so I want to make sure this time I can stay in business and support me and my son. My other son will live with my ex wife.
Thank you in advance for your thoughts, comments and advice.
Bill
I was wondering what an acceptable average profit margin for these market segments are in our industry is?
I know that the costs and expenses for each business are different based on a start up vs. an established business and different parts of the country can garner different amounts per square foot than others...that said, I'm looking for a general range to use as a guide for my business and marketing plan.
I feel I've done a good job of calculating all my expenses for supplies, marketing, education, insurances, repairs replacement equipment costs, salary, misc expenses, etc etc..
I've heard some say profit margins should be a minimum 50-60%. When I shoot for that percentage my prices are astronomical! When I lower it to what are more in line to what current market rates my margin is like 12% and I don't see myself as being to stay in business very long.
Am I missing something? Is it normal in the first few years to be THAT upside down? I need to be profitable from the start and not be working for free hoping in 4-5 years "word of mouth" and referrals will catch hold and take me to the promised land. It didn't work before so I want to make sure this time I can stay in business and support me and my son. My other son will live with my ex wife.
Thank you in advance for your thoughts, comments and advice.
Bill